Financial Planning / Wealth Management

Bespoke solutions

High net worth banking clients ride on global investment insights offered by an international private banker

Competent financial advisers take a needs-based approach when drawing up financial plans for clients. This means that they carefully consider ways of achieving customers' long-term financial goals before finalising their portfolios.

This is according to Sermon Kwan, chief executive, Greater China Region and Korea, Bank of Singapore. "Compared to the US and other European economies, financial planning is a relatively new industry in Hong Kong and the rest of Asia," says Mr Kwan.

The growing affluence in the region is leading to an explosive demand for diverse wealth management services, with banking clients starting to pay more attention to retirement planning and the importance of savings of late. Although there is a broad range of financial products to choose from, including various funds, bonds, foreign currency vehicles and insurance policies, savvy high net worth consumers still tend to prefer real estate and securities, he points out.

A fully-fledged banking and financial services platform supported by the international investment knowledge and financial expertise of its parent company, leading financial services institution OCBC Group, the Bank of Singapore is headquartered in Singapore and positioned as "Asia's global private bank". It boasts a strategic network of offices peppered across Hong Kong, Manila and Dubai, offering an all-encompassing portfolio of personal and highly individualised wealth management services to affluent individuals across the region. These include investment advice, discretionary portfolio management, lending, insurance, estate and trust planning as well as wealth structuring.

"While Hong Kong people generally go for short-term investment returns, our bankers urge diversification by also focusing on a number of long-term investment options such as bonds," Mr Kwan notes.

Solid advice

With strong adherence to a customer-centric service ethos, the bank's advisers encourage their clients to take a long-term view when it comes to wealth creation and accumulation, and to carefully consider potential investment risks, rather than focus solely on more immediate returns.

With this in mind, the bank has a comprehensive range of fixed-income offerings, and particularly bond portfolios. "The average returns from securities have evened out over the past decade, even though global market indices touched record levels in some years. Bonds, on the other hand, have yielded average returns of five to six per cent. For this reason, we also play an educational role to persuade clients to consider products that truly meet their long-term wealth management needs," says Mr Kwan.

This approach entails first gaining a thorough understanding of investors' financial position, family set-up and professional situation. This is followed by identifying their financial requirements and goals, as well as risk tolerance levels. Importantly, once a plan is drawn up, it is reviewed on a regular basis in response to changing customer circumstances and market conditions.

"Customising portfolios is an integral part of a private banker's role," says Mr Kwan. "Considering high net worth customers' wealth and investment literacy, elements such as global asset allocation and tax management are also important."

Another notable feature of wealth management in this segment is transferring assets to the next generation, observes Mr Kwan. "Taking advantage of our global resources, we help our customers to set up trusts or foundations that ensure not only the growth and preservation of their wealth, but also its efficient transfer to their heirs."

In safe hands

The Bank of Singapore's Hong Kong arm currently employs about 60 private bankers, all with university degrees and additional professional qualifications. They are supported by a dedicated team of in-house wealth planning specialists as well as professional advisers and analysts.

The bank invests heavily in staff training and continuous development as a means to ensure that its staff continue to enhance their professional standards and to work towards fulfilling their career aspirations.

An exhaustive range of training is in place covering everything from industry updates to new product knowledge and compliance issues. Employees may also take advantage of a subsidy scheme to gain professional qualifications such as the highly regarded certified financial management plannerTM (CFMPTM) designation conferred by the Hong Kong Institute of Bankers.

As part of an effort to support industry development, while at the same time helping staff members to boost their professional confidence, the bank for the first time this year nominated two high-performing private banking employees to participate in the annual HKIB Outstanding Financial Management Planner Awards.

"This year, the competition includes a brand new category focusing on high net worth customers," says Mr Kwan, a member of the panel of judges consisting of 11 key banking and finance figures in Hong Kong.

The competition has raised public awareness of the importance of financial planning, he adds. "In addition to providing a platform for sharing best practices, the yearly event offers an excellent benchmarking exercise for young professionals who look to develop long-term careers in the field."